President Joe Biden won't actually do anything about hotel resort fees, but by calling them out — and by blaming Congress for any inaction — he can still win with consumers ... who vote.
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President Joe Biden went to war against hotel resort fees and other consumer fees this past fall. He directed federal agencies to find a way to clamp down on or ban them.
Now, however, the Consumer Financial Protection Bureau is prepared to limit credit card fees to $8 but as for the rest of the junk fees Biden criticized, agencies will do nothing more than than continue to “prioritize them” and he’s instead calling on Congress to act. That’s akin to doing nothing, but is also potentially better for Biden politically.
There are four categories of fees that Biden is calling out.
Online Ticket Fees
Service fees for buying an event ticket, which raise the cost compared to the headline price of the ticket. Raising the total cost of the ticket and compensating the ticket broker on the back end would mean more transparent pricing, not lower pricing.
Family Seating Fees
Suggesting parents shouldn’t have to pay more to sit with their children on a flight. The U.S. Department of Transportation plans to require clearer disclosure of such seat assignment costs which represent less than one half of one percent of the department’s consumer complaints. And often when families are separated, it’s during irregular operations, which won’t be addressed here.
Early Termination Fees for TV, Phone and Internet Service
That may limit the availability of upfront discounted plans, since it leads to greater consumer churn. When the up front value of a customer is lower, it doesn’t make sense for a business to invest as much to acquire a customer.
Resort and Destination Fees
Requiring these be included in the advertised cost of the room, and of course since these are not optional in any way they are indeed part of the price. Not including them is fraudulent and deceptive. In addition, resort fees make it harder to comparison shop. They aren’t generally shown when shopping for a rate and each of the properties you might consider appears with a price that is less than the full price — and frequently not even by the same amount.
At a minimum, government could start by removing incentives that encourage resort fees in the first place, such as differential treatment of hotel room rate versus add-on fee taxes at the state and local level.
Much major policymaking has happened through direct federal agency action over the past several years. Former President Obama said nearly a decade ago, “I’ve got a pen and I’ve got a phone.” Congress largely stopped legislating, though it continued appropriating to some extent. So Presidents have acted alone by stretching the meaning of agency authorizing statutes and at times in contravention of the Supreme Court’s major questions doctrine.
However President Biden didn’t take the path followed with the employer vaccine mandate, Centers of Disease Control eviction moratorium, or student loan forgiveness. He either couldn’t do this on his own through a regulatory agency or has chosen not to. He’s calling on Congress to act, which is different than acting.
- He prefers this as a middle-class voter issue rather than a policy that actually happens.
- It’s going to be very difficult to get any of his desired policies passed through a Republican-controlled House with a razor-thin majority in a Senate that often requires 60 votes for action.
- By calling for legislation to pass, Biden is effectively saying, “I am signaling support but nothing will happen, which is good because I can tar my opponents as against middle class consumers who vote.”
- Kicking the issue to Congress opens up corporate checkbooks to provide campaign cash while affected industries lobby against action.
By calling on Congress to act, Biden is declaring that no action will be taken. Campaign cash will be raised in Congress, and his party can grandstand on the issue. And they’re not even touching the scammiest fees in travel.
Gary Leff is an expert on frequent flyer issues. He is also the co-founder of InsideFlyer.com, an online community for travelers. This column first appeared in View from the Wing, a blog Leff launched in 2002.
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Photo credit: President Biden is calling on Congress to abolish certain flight and hotel fees. Gage Skidmore / Wikimedia Commons